An entrepreneur in Bangalore has found that running a BPO (business process outsourcing) operation with physically handicapped people, who have only finished high school, can make money, too.

The firm that Ashok Giri D and his wife, Pavithra Y.S., set up three years ago with an investment of Indian Rupees 6 million (US$117,000), mainly from bank loans, now makes margins of about 15 percent to 20 percent. And they are getting ready to expand from about 120 employees to 400 by the end of this year.

Vindhya E-Infomedia is located in a corner of a maze of streets and by-lanes in the Rajajinagar industrial suburb of Bangalore. The building is an unassuming structure and consists only of a ground floor, making access to work easy for the physically handicapped staff employed there.

"We could not make our business model work in the posh, expensive locations where the large multinational and domestic BPO firms are located," said Giri, who earlier worked in sales at some tech companies.

As the company hires employees who have only finished high school, it is focused primarily on the low-end of the BPO food chain, consisting mainly of data-entry work. High school students in India typically complete 10 years of education, while undergraduates complete 12 years, and graduates 15.

Setting up Vindhya E-Infomedia met Giri's ambition of becoming an entrepreneur and his wife's interest in helping the disabled, including hearing-impaired people, with whom she had earlier worked through nongovernmental organizations (NGOs).

Bangalore's BPO boom has provided opportunities to the city's graduates who earlier would have found it difficult to get jobs. But those who have not studied beyond high school still find it difficult to get well-paying jobs.

More than 80 percent of people hired by BPOs are graduates or undergraduates because of the complexity of the business processes involved, said Amitabh Das, chief executive officer of Vati Consulting, a recruitment firm in Bangalore.

Large BPO companies are not averse to hiring handicapped people, but they do not get many with the education and skill levels they are looking for, Das added.

NGOs have stepped in to train handicapped people out of high school in skills such as using computers. The opportunity for entrepreneurs like Giri is that by hiring and further training them, they can ensure that they will stay with the company for a longer period in an industry severely affected by staff attrition.

"Large companies will not hire candidates who have only finished high school," Giri said. In contrast, graduates tend to see BPO jobs as stop-gap arrangements before higher studies or some other career, he added.

By hiring people with high-school certificates, Vindhya E-Infomedia is not compromising on quality, Giri said. Using graduates for some BPO processes is a waste of skills and expensive, he added.

On the flip side, there are some disadvantages to focusing on hiring handicapped people. A person who has only one hand is not as productive as a person with both hands for a data-entry job, Giri said. "But I can't tell him I am going to pay him half the salary," he added. Average productivity at the company hence turns out to be quite low.

Data entry is also the more commoditized part of the BPO business, and Vindhya E-Infomedia is facing competition from a lot of low-cost, mom-and-pop operations in Bangalore and other cities.

"We are now trying to position ourselves as a premium operation with guarantees on delivery schedules, and error-free work," Giri said.

The competition and lower average productivity in the business also mean that the salaries at Vindhya E-Infomedia are lower than those of multinational companies and large BPO companies operating in Bangalore.

But the company tries to package some thoughtful programs for its staff, including subsidized food, sharing the cost of housing for staff that come from outside Bangalore, and loans to employees to help them buy cycles and motorcycles specially modified for use by physically handicapped people.

Shivagami S. said she quit a job at another BPO in Bangalore to join Vindhya E-Infomedia, even though she now earns half as much. But she has no regrets, because working among other handicapped people makes her comfortable, she said.

"I wasn't comfortable in the other job, because my colleagues at the other job made me conscious that I was different and were at times jealous if I got any concessions," she said.

Shivagami, a polio victim who lives with her parents, said that at Vindhya E-Infomedia she feels "wanted and respected."

Lionel Lewis, who has a speech impediment, said he had been unfairly sacked at a bookstore where he was working. Although the salary is less at Vindhya E-Infomedia, Lewis said he likes working with the company.

Giri recognizes that his business model will not make him a lot of money unless he increases volumes, adds new kinds of outsourced business processes and hires more people. He plans to add more facilities and aims to have 5,000 staff by 2015. There is greater interest from customers, both in India and abroad, he said.

The company has also set up high-speed communications links that enable it to do a lot of the data-entry work online for customers. "We even do online claims processing for a client," Giri said. The work environment does not, however, use any technology specially designed for the handicapped, he added.

Getting more staff is not likely to be a problem as the company expands, as by Giri's estimate there are at least 1.9 million disabled people in Karnataka state who are qualified to be hired. Bangalore is the capital city of Karnataka.

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